Housing

Housing affordability

The Housing Affordability Measure (HAM) provides a picture of how much New Zealanders spend on housing, and tracks whether housing is becoming more or less affordable over time for renters and potential first home buyers (based on income data, rent/mortgage payments, rates and insurance; adjusted for household size). The HAM Buy indicator addresses whether a household that is currently renting can feasibly afford to own a home (i.e., hypothetically, if they bought a lower quartile-valued dwelling in their Territorial Authority). The HAM Rent indicator addresses whether a household that rents can feasibly afford to live in their current accommodation [10]. The HAM does not set a level at which housing is or is not affordable. Determining affordability depends on each household’s circumstances and expectations of what qualifies as a socially accepted standard of living [10] (i.e., rating what goods and services are necessary is subjective).

This indicator presents the proportion of households with below average income after deducting housing costs. This measure is presented separately for potential first homeowners (HAM Buy), and for renters (HAM Rent), for each Territorial Authority in greater Christchurch and for New Zealand, from 2008 to 2018. Higher numbers on the HAM measure indicate less affordable housing (these data report version 1.3 of HAM).

The figure shows that the proportion of potential first home buyer households in Christchurch City with below average income after housing costs decreased by just over one percentage point from 74.4 percent in March 2017 to 73.3 percent in March 2018. This finding indicates that housing (ownership) became marginally more affordable over this period. The proportion in March 2018 was slightly higher in Waimakariri District (75.2%) and substantially lower in Selwyn District (56.9%). At a national level, the proportion of potential first home buyer households with below average income after housing costs remained relatively unchanged between March 2017 and March 2018; 79.9 percent and 80.1 percent respectively (i.e., the picture of decreasing first home buyer affordability, apparent nationally since March 2016, has flattened). Overall, the HAM Buy indicates that home ownership affordability for potential first home buyer households in greater Christchurch has stabilised from early 2017 to the current time point (March 2018).

The figure shows that the proportion of renter households in Christchurch City with below average income after housing costs has increased between March 2017 (56.4%) and March 2018 (59.0%). The proportion in March 2018 was slightly smaller in Waimakariri District (56.8%) and substantially smaller in Selwyn District (40.6%), which indicates comparatively affordable renting in Selwyn District. For New Zealand overall, the proportion of renter households with below average income after housing costs declined between March 2017 (60.7%) and March 2018 (59.0%). This decline continues the general pattern of increasing affordability for renters for New Zealand overall, apparent since approximately March 2013.

Overall, affordability for renter households in Christchurch City and Waimakariri District has reduced, with the HAM Rent converging towards that for New Zealand overall between March 2016 and March 2018. HAM Rent in Selwyn District has remained consistently lower than in Christchurch City and Waimakariri District throughout the time series presented. Taken together, the data for HAM Buy and HAM Rent illustrate that housing costs take a smaller proportion of household income for renters than for first home buyers.

Data Sources

Source: Ministry of Housing and Urban Development.
Survey/data set: Data set (HAM version 1.3) created for research purposes from the Integrated Data Infrastructure (IDI), managed by Statistics New Zealand. Access publicly available data from the Ministry of Housing and Urban Development website www.hud.govt.nz/news-and-resources/statistics-and-research/housing-affordability-measure-ham/
Source data frequency: Quarterly.

View technical notes and data tables for this indicator.

Updated: 08/08/2019